-----Forwarded Message----- -----Original Message----- From: articles-email@private [mailto:articles-email@private] On Behalf Of tabauman@private Sent: Monday, April 07, 2003 3:24 PM To: frankh@private Subject: NYTimes.com Article: Domestic Security: The Line Starts Here This article from NYTimes.com has been sent to you by tabauman@private fyi tabauman@private Domestic Security: The Line Starts Here April 6, 2003 By PHILIP SHENON WASHINGTON ONLY three months in town, and Charles E. McQueary has found himself just about the most popular man in wartime Washington. Powerful lobbyists and corporate executives track down his new telephone number and call him unannounced; strangers buttonhole him in the halls of Congress, hoping for a few precious minutes of his time. Dr. McQueary, a former executive of General Dynamics and Bell Laboratories, is the newly confirmed undersecretary for science and technology in the Department of Homeland Security. In that job, he will influence how the giant new agency and the rest of the federal government spend tens of billions of dollars on technology to defend American soil from terrorist attacks. A genial, Texas-born engineering Ph.D., Dr. McQueary is now the government's chief contact with the scientists, technicians and entrepreneurs who are searching for ways to help their companies profit from the public's understandable fixation with keeping their families and communities safe from terrorism - a threat that probably has grown as a result of the war with Iraq. Dr. McQueary got a taste of his newfound celebrity when, seconds after he finished testifying at his Senate confirmation hearing last month, he was approached in the hearing room by an entrepreneur who wanted to promote data-mining software that might help in the government's hunt for terrorists. "I gave him an e-mail address," said Dr. McQueary, who has established a special e-mail account for dealing with the sudden crush of lobbyists, corporate executives and hand-to-mouth entrepreneurs who want to pitch their domestic-security wares. (science.technology@private). "Through my whole professional career, I always answered my own telephone, but it's rapidly getting to the point where that's not feasible anymore," said Dr. McQueary, who says he is more excited than beleaguered by his assignment. "I don't know if inundated is the right word, but we certainly are hearing from a number of people with ideas. And some of them are very good ideas." The domestic-security industry may be new, a legacy of the Sept. 11, 2001, terrorist attacks and the widespread fear among intelligence agencies that Americans will be a central terrorist target for years to come. But most components of the industry are well established; the largest players include major military contractors, giant electronics makers and private security companies looking for new markets for their expertise. HOWEVER defined, the domestic-security market is huge - and growing. There are as many different sales forecasts for the industry as there are research groups doing the estimating. But all of the industry's multibillion-dollar forecasts are bullish. An industry-supported institute called the Homeland Security Research Corporation, in San Jose, Calif., predicts that overall public and private spending on domestic security will jump to $120 billion to $180 billion in 2008 from $65 billion this year. Another trade group, the Government Electronics and Information Technology Association of Arlington, Va., says its tabulation shows that federal spending on domestic-security technology will reach $13 billion in the current fiscal year and rise to $14.6 billion in the 2008 fiscal year, a figure that does not include inflation. Critics have said the Bush administration is devoting too little money to the Department of Homeland Security, the new superdepartment that is consolidating the work of 22 federal agencies. The White House is seeking an overall budget for the department of about $38 billion next year, a 7 percent increase. Lawmakers from both parties seem determined to spend billions more on domestic security, especially given the renewed worries about terrorism threats, and the administration seems likely to bow to their pressure. Beyond Washington, state and local governments face similar huge demands to increase security spending, as does private industry, which is confronted with billions of dollars a year in new security costs, especially for companies considered likely terrorist targets, like airlines, chemical manufacturers and nuclear power generators. "The money is just beginning to flow," said Bruce Aitken, a Washington lawyer and lobbyist who is president of the Homeland Security Industries Association, a trade group that has signed up more than 100 companies as members since it was incorporated in July. They include the giant government contractors Lockheed Martin, General Dynamics, Bechtel and Fluor. "We think that the United States is extremely vulnerable to terrorist attack," said Mr. Aitken, who is about to announce the establishment of a political action committee to promote the industry's interests on the campaign trail. "We've got a lot of weak links, and it's going to take a lot of money to get that changed." No military contractor is as closely associated with the war in Iraq as Raytheon, which makes the Tomahawk and Patriot missile systems; the war began last month when dozens of Tomahawks slammed into targets in Baghdad. But the company, based in Lexington, Mass., is eager to be seen these days as the government contractor of choice when it comes to dealing with enemies who might strike closer to home. WITHIN days of the terror attacks in September 2001, Raytheon announced Project Yankee, a companywide effort to determine how its military expertise and products might be converted to use in domestic counterterrorism. In June, the company took the next step, formally creating a new division based in Falls Church, Va., outside Washington, to oversee its domestic-security business. Its first major product is now arriving on the market, a $250,000 command-and-control vehicle called the First Responder, which is a Chevy Suburban sport utility vehicle packed with communications equipment and antennas allowing emergency-response agencies to communicate with one another even if they use different radio frequencies. Raytheon officials say that in a major terrorist attack, the vehicle would overcome some of the logistical problems that hampered the disaster scenes in Lower Manhattan and the Pentagon on Sept. 11, 2001, when emergency workers using different, incompatible communications equipment poured in to help from cities and towns hundreds of miles away. "The First Responder is just coming off the assembly line," said Dale Craig, a retired Army communications specialist who joined Raytheon after 30 years in the military; he is now directing the First Responder program. "This is a product whose time is here." The first of the vehicles is bound for the Los Angeles County Sheriff's Department, and Raytheon said it was in negotiations with almost 300 potential buyers, including many police and fire departments around the country. Another military contractor, Northrop Grumman, is working with a small high-technology company in Bedford, N.H., Imaging Automation, to promote security systems that would allow the federal government to quickly authenticate passports, visas and other documents presented at security checkpoints. The Imaging Automation system, which uses a small glass-top metal box on which a document can be scanned in seconds for signs of forgery, has already been sold to the governments of Hungary and Australia, to the British airports authority and to Logan Airport in Boston, where it is used to verify documents presented by potential employees. Imaging Automation, which has 60 employees, is a private company and does not release its financial results. But Bill Thalheimer, the chief executive, said he expected sales to double this year over last, and to triple next year from this year. "And that's all exclusive of what the federal government might want to do," he said. In an age of terrorist threats and fears, the opportunities of the market reach beyond high technology, and companies that make basic home security and alarm systems are also poised to benefit. Anyone who visited a supermarket or hardware store in early February, when the White House raised the color-coded terrorism alert and urged the public to stock up on basic survival supplies, understands that American families are willing to spend freely on their own protection. After a year of corporate scandal and criminal charges against executives, the employees of Tyco International were probably entitled to a little good news, and they got it as a result of the February alert. Tyco is one of the world's largest makers of duct tape, and demand was so strong for its Nashua-brand tape that it switched the production line at its Kentucky plant to making residential duct tape instead of the commercial variety. WHILE much of the early business of the Department of Homeland Security seems likely to go to large government contractors that have the track record and lobbying muscle to make themselves quickly known to the new agency, the department says it wants to serve as an incubator to innovative small and midsize companies. "We're going to find there are some real good ideas from small companies," said Dr. McQueary, who is expected to spend much of his first several months at the department deciding on technology to help secure border checkpoints to block the entry of terrorists and their weapons. He said he was trying to set aside time each week to meet with small, creative inventors who had domestic-security ideas that big contractors might have overlooked. "I had an individual come by to see me the other day with an idea for a secure manhole cover," Dr. McQueary said. "I was happy to give him 15 minutes. It's a manhole cover that couldn't be easily lifted out of its recess, and so terrorists couldn't easily get in and hide. Not a bad idea." http://www.nytimes.com/2003/04/06/business/yourmoney/06LOBB.html? ex=1050754225&ei=1&en=d44eb7b2099f5f51 HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@private or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@private Copyright 2003 The New York Times Company
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